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Hospital executives weigh in on state healthcare laws

CORNELIUS – Two of the Lake Norman region’s foremost healthcare executives believe there are better options than a free-market system for hospitals.

Novant Health Huntersville Medical Center President Tanya Blackmon joined Carolinas HealthCare System Vice President Del Murphy in discussing the merits of certificate of need laws for hospitals.

The Lake Norman Chamber of Commerce-hosted discussion on Feb. 21 gave both leaders a chance to champion keeping CON laws in the state.

Hospitals and healthcare specialist facilities have to apply for a CON – a process that takes 90 to 150 days for review – for regulated services including beds, as well as any project costing more than $2 million and medical equipment costing more than $750,000.

“If we completely eliminated CON laws, you can’t do that in a vacuum,” he said. “It’s got to be on a much broader scale. We need to look at other regulatory issues and impacts. To simply remove CON in a standalone vacuum, you will provide a competitive advantage and disadvantage other entities to the point that you will hurt them. The first ones who would be hurt are the small, rural hospitals.”

The federal government mandated each state use CON laws in the 1970’s, but the mandate fell by the wayside in 1983. The Southeastern states still use them to varying degrees of depth, but some states – including California, Texas and Indiana – have no CON laws.

Blackmon wants the state to keep the laws. She said modernizing them, in the sense of removing the need to apply for equipment transfers, is a good idea.

“The CON laws make sure that we have services placed where they need to be in the community and they correct market deficits,” she said. “We know there have been some changes to renovate our facilities without having to get a CON for that. We want to continue to work with the legislators and the state to modernize it.

“It’s important for people in this community to be able to take charge of our own healthcare, and know what’s going on. It really impacts our lives.”

Murphy said keeping CON laws are important because the U.S. spends more on healthcare than any other country and the more available medical resources are, the more they’ll be used.

He said the healthcare industry competes on quality and service, but may not under a market-based system. “There are some that say, ‘Just abolish the law and costs will go down,’ but you can look at California and Texas, who have no law, but their healthcare costs are higher,” he said.

Lake Norman Chamber of Commerce President Bill Russell said he understands why CON laws can be necessary. Regardless of the laws’ future, he believes healthcare in the region is in a good position.